Total annual revenues for FTSE 350 companies with year ends up to the end of December 2014, which reported them during the first quarter, were £1.44 trillion, down by £116bn compared with a year ago.

On a like for like basis, this was a 7.7 per cent fall. Weak global economic growth also hit revenues in the UK stock market’s three largest sectors – oil, mining and banking.

The oil sector lost £63bn, the banking sector was down £24bn and mining companies were down £23bn. The strength of sterling in 2014 also took its toll, especially for companies that report in dollars. One third of the total decline in revenues was due to the higher value of sterling.

The decline was reflected in company profits. Gross profits totalled £208.4bn, representing a fall of 11.7 per cent on a like for like basis. 21 sectors saw operating profits fall, compared with nine who saw them rise – the weakest ratio since at least 2007. Overall, operating profits fell by a fifth (down 18.4 per cent like for like), declining to £91.3bn – a drop of more than £20bn.

Overall, companies reporting annual results in the first quarter of 2015 recorded net profits of £64.3bn. This represented a like-for-like fall of 9.8 per cent, and was the lowest level of profit since 2008, when this group posted post-tax profits of £33.8bn.

While miners and financials made positive contributions, this was overshadowed by the declining profitability of the oil sector, pharmaceuticals, gas utilities, aerospace and tobacco. The number of sectors with net profits rising actually outnumbered those witnessing falls (by 20 to 17), but the size of the sectors which registered a drop led to the profits falling.

Helal Miah, investment research analyst at The Share Centre, said: “The goliaths in the FTSE 100 came under intense pressure from a potent cocktail of negative currency effects, falling oil prices and spluttering global growth in 2014. This has taken its toll on results across the UK stock market, with company profits at their lowest level in six years.

“The worst should now be behind us. Oil prices will continue to challenge the sector, and the eurozone remains a concern. However, the pound has now fallen sharply against the dollar, which will boost the results of the UK’s largest companies and the financial sector should continue to strengthen. With the domestic economy recovering healthily, alongside real household incomes now rising, we believe profits should increase strongly, especially for mid-caps in more domestically orientated sectors.

“With the UK index so concentrated in the oil, mining and large banks, the index is actually far less diversified than in many other countries. If challenging global trends hit simultaneously, as we saw last year, investors focused on the UK index can be left exposed and facing more risk than expected.

“It’s crucial to be diversified throughout different sectors and size companies, not least because it will allow greater exposure to faster growing, domestically sensitive companies.”

While the performance of the UK’s big multinational companies weighed on the overall revenues and profits of the FTSE 350, companies in the FTSE 250 have broadly been moving at a different speed, the report said. Revenues actually rose in the FTSE 250 (+0.6 per cent like for like), while operating profits of mid caps saw a much smaller decline than their large cap peers.